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NJ Legislature Pilloried, High Court Praised in Tort-Reform Group's Annual 'Hellholes' Report

Credit: PrasongTakham/Shutterstock.com.

Seeing fit to expand its target list to include lawmakers in addition to jurists, the tort-reform group known for issuing an annual report declaring certain jurisdictions "judicial hellholes" has taken to task the New Jersey Legislature for what it calls a pro-plaintiff, and pro-plaintiffs lawyer, series of measures.

At the same time, the 2018-19 report from the American Tort Reform Association offers some rare praise to the New Jersey Supreme Court, in the "points of light" section, for its decisions on products liability, class actions and consumer contracts.

"While the Judicial Hellholes report typically focuses on the courts, the New Jersey legislature is an exception because of its drastic liability-expanding agenda for the 2018-2019 session," the report said, ranking the state Legislature No. 7 on its list of nine "hellholes."

"The trial bar also has gained significant power and influence in the state legislature, leading to legislators’ refusal to entertain even the most modest of tort reforms," ATRA said.

As for the praise, the organization pointed to the court's "series of well-balanced decisions."

"A perennial Judicial Hellhole, the court took very important steps in helping to restore fairness in the state’s legal system," the report said.

ATRA pointed to several pieces of legislation, including the Diane B. Allen Equal Pay Act enacted last April, which the report claims imposes "draconian penalties and an extensive look back period, all of which greatly benefit trial lawyers." The report also took issue with S-2145, enacted in August, which provides that attorney fee awards in workers' compensation cases be based on the full amount of the award, not reduced by a settlement offer.

The report also contends more generally that plaintiff lawyers in New Jersey have "gained enormous power" thanks to the 2017 election of Democratic Gov. Phil Murphy, and that Democratic Senate Judiciary Committee Chairman Nicholas Scutari, "a trial lawyer by trade … has seen his political influence skyrocket" because his committee has the power to confirm Murphy's appointment nominees.

The report singles out Scutari for sponsoring two measures, which are still pending: S-2144, the New Jersey Insurance Fair Conduct Act, which concerns bad-faith claims against insurance carriers, and S-1766, which would make emotional damages recoverable in wrongful death cases.

The latter measure "would make cases more difficult to settle and would increase insurance premiums for all New Jersey residents," ATRA contended in the report.

ATRA praised the Supreme Court first and foremost for its 2018 ruling in In re Accutane Litigation. "At long last, New Jersey will no longer be considered an evidentiary outlier that permits plaintiffs to bring meritless cases based on junk science," ATRA said, because the court "joined federal courts and the vast majority of states in adopting the Daubert standard for assessing the reliability of expert testimony." It also praised the court for, shortly after the expert testimony ruling, dismissing the Accutane suits that remained.

The court also was credited with issuing two decisions on the Truth-in-Consumer Contract, Warranty and Notice Act—Dugan v. TGI Friday's in late 2017 and Spade v. Select Comfort in 2018—that ATRA said "will substantially reduce the potential for the type of no-injury claims that have flooded New Jersey courts by clarifying who is an 'aggrieved' consumer entitled to bring a claim under the statute."

The report also gave a nod to Murphy: he "returned to the longstanding tradition of reappointing Supreme Court justices based on merit," resisted "the urge to pack the court with political allies" and "preserved nonpartisan judicial independence," the organization said, by reappointing Justice Anne Patterson to the court.

In a statement responding to ATRA's latest offering, Suzanne Kizis, current president of plaintiffs lawyer group New Jersey Association for Justice, called the report "a public relations gimmick prepared by corporate and insurance interests to complain when they are losing cases in front of juries comprised of our fellow citizens who are sworn to make decisions in a fair and impartial manner.

"They package it with a catchy title and trot out the same arguments every year," said Kizis, of Wilentz, Goldman & Spitzer in Woodbridge, adding, "This is another example of corporate and insurance interests trying to keep ordinary people, families, consumers and workers, from having the same access to justice that they do. It’s not right. It’s not fair. It’s not just."

Scutari could not be reached for comment at his Linden law office.

New Jersey courts ranked No. 6 in ATRA's hellholes report a year ago.

The New Jersey Legislature is one of nine venues ATRA put on its designated hellholes list this year.

California once again topped the annual list, and has done so at least three prior times, but last year’s report bumped it to No. 2 in favor of Florida, whose highest court came out with numerous medical malpractice decisions for plaintiffs. This year, Florida ranked No. 2.

California’s top ranking comes after the state’s highest court became the first in the nation to hold manufacturers of brand-name pharmaceuticals liable in cases involving their generic equivalents.

New York City’s courts jumped to No. 3. The report expanded its ranking of the city’s asbestos litigation court to include all courts in New York City. That’s primarily because of a growth in class actions brought over food packaging, ATRA said.

And like years past, the report chastised the Complex Litigation Center in the Philadelphia Court of Common Pleas, which ranked No. 6, down one spot from last year, largely because of its pharmaceutical verdicts. And it called Pennsylvania's courts among those to watch because of their acceptance of out-of-state plaintiffs.

In another highlight from the "Judicial Hellholes" report, St. Louis continued to be on the list, at No. 4, down one ranking from last year, in part because of a $4.7 billion verdict against Johnson & Johnson over its baby powder.

Some overriding concerns in the report involved: the prevalence of “junk science” at trials; class actions, particularly involving food packaging, which the defense bar insists have no injuries; and "activist" attorneys general who have brought cases over opioids and climate change.

ATRA president Sherman “Tiger” Joyce said in a statement: “With both this annual report and a year-round website, our Judicial Hellholes program since 2002 has been documenting troubling developments in jurisdictions where civil court judges systematically apply laws and court procedures in an unfair and unbalanced manner, generally to the disadvantage of defendants."

Peter Knudsen, a spokesman for the American Association for Justice, the nation’s largest plaintiffs bar, said of the report: “ATRA’s definition of a ‘hellhole’ is a courtroom where a plaintiff brings a case in front of a jury to hold an unscrupulous corporation accountable. The real hellhole is a world in which an unsuspecting consumer is harmed, abused or defrauded by an unscrupulous corporation but has no recourse and no chance to prevent future wrongdoing.”